Grille closing

Corene and Joseph Teneriello of Dracut, Mass., have a drink at the Milltowne Grille at Manchester-Boston Regional Airport before flying out to Orlando, Fla., on Tuesday. (DAVID LANE/UNION LEADER)

MANCHESTER — The Milltowne Grille, a restaurant frequent flyers have come to rely on over the past two decades at Manchester-Boston Regional Airport, is shutting down in early January, citing a decline in flights from Southwest Airlines and competition from a new restaurant.

But as owners Edward Aloise and his wife, Claudia Rippee, close Milltowne Grille in mid-February they plan to open an Italian wine bar called Campo Enoteca on Elm Street at the site of the former Peking Garden. The restaurateurs also operate Republic, a European-style, farm-to-table restaurant further north on Elm Street.

"It is bittersweet," Aloise said. "Our lease is expiring, and we are not renewing it."

Deputy airport director Brian O'Neill said Aloise and Rippee are great restaurateurs. "We are saddened and very disappointed," he said. "They are a valued partner at the airport and will be missed."

The Milltowne Grille opened at the same time as the new terminal in 1994. The airport recently selected the couple from those sumbitting proposals to continue operating a full-service restaurant at the airport for another 20 years, O'Neill said. But during contract negotiations Aloise and Rippee instead decided to close Milltowne.

The lease expired in July 2012, Aloise said, and the restaurant has been operating on a month-to-month basis. The decision to close was based on economics.

"It's not financially viable," he said. Operating costs for the restaurant are higher because it is located in the secured section of the airport, he said.

Employees have to pass the same background tests given TSA employees, which means Milltowne can't hire someone one day and put him to work the next. And all supplies and food have to be inspected before delivery to the restaurant.

O'Neill said it was Aloise and Rippee's idea to move the entrance to the restaurant from the unsecured side to the secured side, a move airport officials thought was a good one. Their business grew exponentially as a result, he said.

Aloise said one of the biggest factors in the decision was Southwest Airlines' cutting its daily flights to as few as nine — more than three times less than the peak, according to airport officials.

"Your sales are limited to the number of people flying," he said.

The decrease in Southwest flights adversely affected the number of customers, all part of the captured flying audience at the airport. And eight months ago Samuel Adams Manchester Meetinghouse opened on the secured side of the airport, bringing in more competition, Aloise said.

O'Neill said Southwest, which came to Manchester in 1998, topped out at 33 flights a day and, depending on the day of the week and the time of the year, now has as few as nine to 10 daily flights. The average is about 15 to 17 flights a day, he said.

He pointed out that Milltowne operated from 1994 to 2001, when there were fewer passengers then there are today and were successful. While there are fewer flights, O'Neill said Milltowne also faced more competition from Samuel Adams Manchester Meetinghouse.

"They have been doing very well," he said.

And Dunkin' Donuts, which has two sites at the airport, changed its menu to include sandwiches, providing even more competition, O'Neill said.

Aloise said he and his wife put a lot of effort into the airport location, and they are saddened by having to close the restaurant. But he said the economic situation demands it: They could not continue to operate without if Southwest Airlines intendeds to relocate its base of operations to another airport, like Logan International Airport.

There is good news, however. None of the 25 people employed at Milltowne will lose their jobs. Aloise said all of them will be staffing Campo Enoteca.

"We're very fortunate to have some very loyal people," Aloise said. "That's our strength, the longevity of our staff." He said some employees have been with Milltowne for a decade.

He said the Italian wine bar will be as "dramatic to downtown as Republic is. Nobody has seen this kind of Italian food."

Campo Enoteca will feature contemporary Italian cuisine of small plates, fresh pasta made using an imported Italian pasta machine, charcuterie — a culinary specialty that originally referred to pork products such as salami, sausages, and prosciutto — also imported from Italy — antipasti, crostinis and, as is done at Republic, locally sourced fish, chicken and beef.

"We're very excited," he said.

O'Neill said the airport is looking to replace Milltowne with another full-service restaurant and has reached out to other concessions that are interested in expanding. Other restaurants and cafes at the airport include Quiznos, Smuttynose Cafe, Great American Bagel Co. and Starbucks.